BILL NUMBER: SB 778 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 14, 2012
AMENDED IN ASSEMBLY MAY 21, 2012
AMENDED IN SENATE JANUARY 5, 2012
AMENDED IN SENATE JANUARY 4, 2012
INTRODUCED BY Senator Padilla
FEBRUARY 18, 2011
An act to add Section Sections
25600.1 and 25600.2 to the Business and Professions Code,
relating to alcoholic beverages.
LEGISLATIVE COUNSEL'S DIGEST
SB 778, as amended, Padilla. Alcoholic beverages licensees:
contests and sweepstakes.
The Alcoholic Beverage Control Act prohibits any licensee from
giving any premium, gift, or free goods in connection with the sale
or distribution of any alcoholic beverage, except as provided.
This bill would permit an authorized licensee, as defined, to
conduct, sponsor, or participate in conduct
a consumer contest or sweepstakes, as defined, offering the
chance to win prizes, if specified conditions are met.
The Alcoholic Beverage Control Act provides that a violation of
any of its provisions for which another penalty or punishment is not
specifically provided is a misdemeanor. This bill would expand
existing crimes by imposing additional duties on a licensee under the
act, thus, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 25600.1 is added to the
Business and Professions Code , to read:
25600.1. (a) An authorized licensee may conduct consumer
contests, subject to the following conditions:
(1) (A) No entry fee may be charged to participate in a contest
authorized by this subdivision. Entry or extra chances in a contest
shall not be made available via the purchase of an alcoholic
beverage.
(B) Entry into or participation in a contest shall be limited to
persons 21 years of age or older.
(C) No contest shall require consumption of alcoholic beverages by
a participant.
(D) A contest may not be conducted for the benefit of any
permanent retail licensee.
(2) (A) Closures, caps, cap liners, corks, labels, cartons, cases,
packaging, or other similar material shall not be used as an entry
to a contest or as a means of determining the amount or size of the
prize or the winner in a contest, except as provided in subparagraphs
(D) and (F).
(B) The authorized licensee shall provide an alternative means of
entry that does not require a visit to a licensed premises.
(C) Except as provided in subparagraph (D), removable entry forms
shall not be used on alcoholic beverage labels, containers,
packaging, cases, or cartons.
(D) Removable entry forms that are neck hangers shall be used only
on bottles of wine or distilled spirits, and shall not require
purchase of the product. Removable neck hangers shall be used only if
other entry forms are available at the point of sale or if an
alternative means of entry is also available.
(E) Entry forms may be provided through electronic or other media,
including point of sale.
(F) Codes that may be scanned or electronically entered by a
consumer where the authorized licensee has permanently affixed the
codes as part of the original alcoholic beverage label, container,
packaging, case, or carton, and where the codes are not removable and
not required to be removed are permitted as a form of entry.
(G) All permitted means of entry, including the use of electronic
or scanner codes, shall clearly indicate that no purchase is required
to enter.
(3) A contest shall not provide for the instant or immediate
awarding of a prize or prizes. Instant or immediate notification to
the consumer that he or she is a winner is permissible.
(4) A contest authorized by this section shall not be conducted at
the premises of a retail licensee or the premises of a winegrower or
beer manufacturer operating under a duplicate license for a branch
office.
(5) Alcoholic beverages or anything redeemable for alcoholic
beverages shall not be awarded as a contest prize. This paragraph
shall not prohibit a contest in which the prize is cash or cash
equivalent or the awarding of cash or cash equivalent in lieu of a
prize that is tangible personal property or real property.
(6) A retail licensee shall not serve as the agent of an
authorized licensee by collecting or forwarding entries or awarding
prizes to a contest winner.
(7) A licensee that is not an authorized licensee shall not
directly or indirectly underwrite, share in, or contribute to, the
costs of a contest authorized by this section or serve as the agent
of an authorized licensee to collect or forward entries or to furnish
any prize to a contest winner.
(8) (A) Advertising of a contest shall comply with the signage and
advertising restrictions contained in this chapter, Chapter 15
(commencing with Section 25500), and any regulations issued by the
department.
(B) Advertising or promotion of a contest shall not identify or
refer to any retail licensee.
(C) A retail licensee shall only advertise or promote a contest
authorized by this section in the manner specified in subparagraph
(A).
(D) Advertising or promotion of a contest shall only be conducted
on the premises of a retail licensee when such advertisement or
promotion involves a minimum of three unaffiliated retail licensees.
For purposes of this subparagraph, "unaffiliated retail licensees"
shall not include any retail licensee owned or controlled in whole or
in part by an authorized licensee or any officer, director, or agent
of that licensee.
(E) Placement of signs or other advertising of a contest in a
licensed retail premises shall not be conditioned upon the following:
(i) The placement of any product within the licensed premises or
the restriction, in any way, of the purchase of a product by a
licensee, the removal of a product from the sales area of a licensed
premises, or the resetting or repositioning of a product within the
licensed premises.
(ii) The purchase or sale of any product produced, imported,
distributed, represented, or promoted by an authorized licensee or
its agent.
(F) An agreement, whether written or oral, entered into, by, and
between a retail licensee and an authorized licensee or its agent
that precludes the advertisement or promotion of a contest on the
premises of the retail licensee by another authorized licensee is
prohibited.
(9) Contest prizes shall not be awarded to an authorized licensee,
retail licensee, or wholesale licensee or agent, officer, employee,
or family member of an authorized licensee, retail licensee, or
wholesale licensee. For purpose of this paragraph, "family member"
means a spouse, parent, sibling, child, son-in-law, daughter-in-law,
and lineal descendants, including those by adoption. An authorized
licensee shall maintain all records pertaining to a contest for three
years following the completion of a contest. This section shall not
apply to contests conducted by an authorized licensee as part of a
sales incentive program for wholesale licensees or their employees or
an authorized licensee's employees.
(b) Nothing in this section shall preclude licensees from
sponsoring contests as permitted by regulations of the department.
(c) For purposes of this section:
(1) (A) "Authorized licensee" means a winegrower, beer and wine
importer general, beer manufacturer, out-of-state beer manufacturer
certificate holder, distilled spirits manufacturer, distilled spirits
manufacturer's agent, distilled spirits importer general, distilled
spirits general rectifier, rectifier, out-of-state distilled spirits
shipper's certificate holder, brandy manufacturer, and brandy
importer. An authorized licensee may conduct, sponsor, or participate
in a consumer contest pursuant to this section if the licensee holds
any additional license not included in this paragraph.
(B) An "authorized licensee" shall not include a beer and wine
wholesaler, a beer and wine importer general, or distilled spirits
importer general that only holds a wholesaler's or retailer's license
as an additional license.
(2) "Contest" means a game, contest, puzzle, or similar activity
that holds out or offers to participants the opportunity to receive
or compete for gifts, prizes, gratuities, or other things of value as
determined by skill, knowledge, or ability rather than upon random
selection. Skill, knowledge, or ability does not include the
consumption or use of alcoholic beverages.
(d) Nothing in this section authorizes conducting any contest
where consumers are entitled to an allotment or accumulation of
points based on purchases made over a period of time that can be
redeemed for prizes, things of value, or additional contest entries.
(e) An authorized licensee that violates this section, in addition
to any other penalty imposed by this division, may be prohibited by
the department from offering a contest to California residents for a
period of 12 months.
SEC. 2. Section 25600.2 is added to the
Business and Professions Code , to read:
25600.2. (a) An authorized licensee may conduct consumer
sweepstakes, subject to the following conditions:
(1) (A) No entry fee may be charged to participate in a
sweepstakes authorized by this subdivision. Entry or extra chances in
a sweepstakes shall not be made available via the purchase of an
alcoholic beverage.
(B) Entry into or participation in a sweepstakes shall be limited
to persons 21 years of age or older.
(C) No sweepstakes shall require consumption of alcoholic
beverages by a participant.
(D) Subject to subparagraph (B), any sweepstakes offered in
California shall be open to all residents of California.
(E) A sweepstakes may not be conducted for the benefit of any
permanent retail license.
(2) (A) Closures, caps, cap liners, corks, labels, cartons, cases,
packaging, or other similar material shall not be used as an entry
to a sweepstakes or as a means of determining the amount or size of
the prize or the winner in a sweepstakes, except as provided in
subparagraphs (D) and (F).
(B) The authorized licensee shall provide an alternative means of
entry that does not require a visit to a licensed premises.
(C) Except as provided in subparagraph (D), removable entry forms
shall not be used on alcoholic beverage labels, containers,
packaging, cases, or cartons.
(D) Removable entry forms that are neck hangers shall be used only
on bottles of wine or distilled spirits, and shall not require
purchase of the product. Removable neck hangers shall be used only if
other entry forms are available at the point of sale or if an
alternative means of entry is also available.
(E) Entry forms may be provided through electronic or other media,
including point of sale.
(F) Codes that may be scanned or electronically entered by a
consumer where the authorized licensee has permanently affixed the
codes as part of the original alcoholic beverage label, container,
packaging, case, or carton, and where the codes are not removable and
not required to be removed are permitted as a form of entry.
(G) All permitted means of entry, including the use of electronic
or scanner codes, shall clearly indicate that no purchase is required
to enter.
(H) All sweepstakes entry forms shall provide an entrant with an
equal odds of winning.
(3) A sweepstakes shall not provide for the instant or immediate
awarding of a prize or prizes. Instant or immediate notification to
the consumer that he or she is a winner is permissible.
(4) A sweepstakes authorized by this section shall not be
conducted at the premises of a retail licensee or the premises of a
winegrower or beer manufacturer operating under a duplicate license
for a branch office.
(5) Alcoholic beverages or anything redeemable for alcoholic
beverages shall not be awarded as a sweepstakes prize. This paragraph
shall not prohibit a sweepstakes in which the prize is cash or cash
equivalent or the awarding of cash or cash equivalent in lieu of a
prize that is tangible personal property or real property.
(6) A retail licensee shall not serve as the agent of an
authorized licensee by collecting or forwarding entries or awarding
prizes to a sweepstakes winner. The matching of entries with numbers
or pictures on the point-of-sale materials at retail licensed
premises is permitted only if entrants are also offered the
opportunity to use an alternative means to determine prize-winning
status.
(7) A licensee that is not an authorized licensee shall not
directly or indirectly underwrite, share in, or contribute to, the
costs of a sweepstakes authorized by this section or serve as the
agent of an authorized licensee to collect or forward entries or to
furnish any prize to a sweepstakes winner.
(8) (A) Advertising of a sweepstakes shall comply with the signage
and advertising restrictions contained in this chapter, Chapter 15
(commencing with Section 25500), and any regulations issued by the
department.
(B) Advertising or promotion of a sweepstakes shall not identify
or refer to any retail licensee.
(C) A retail licensee shall only advertise or promote a
sweepstakes authorized by this section in the manner specified in
subparagraph (A).
(D) Advertising or promotion of a sweepstakes shall only be
conducted on the premises of a retail licensee when such
advertisement or promotion involves a minimum of three unaffiliated
retail licensees. For purposes of this subparagraph, "unaffiliated
retail licensees" shall not include any retail licensee owned or
controlled in whole or in part by an authorized licensee or any
officer, director, or agent of that licensee.
(E) Placement of signs or other advertising of a sweepstakes in a
licensed retail premises shall not be conditioned upon the following:
(i) The placement of any product within the licensed premises or
the restriction, in any way, of the purchase of a product by a
licensee, the removal of a product from the sales area of a licensed
premises, or the resetting or repositioning of a product within the
licensed premises.
(ii) The purchase or sale of any product produced, imported,
distributed, represented, or promoted by an authorized licensee or
its agent.
(F) An agreement, whether written or oral, entered into, by, and
between a retail licensee and an authorized licensee that precludes
the advertisement or promotion of a sweepstakes on the premises of
the retail licensee by another authorized licensee or its agent is
prohibited.
(9) Sweepstakes prizes shall not be awarded to an authorized
licensee, retail licensee, or wholesale licensee or agent, officer,
employee, or family member of an authorized licensee, retail
licensee, or wholesale licensee. For purpose of this paragraph,
"family member" means a spouse, parent, sibling, child, son-in-law,
daughter-in-law, and lineal descendants, including those by adoption.
An authorized licensee shall maintain all records pertaining to a
sweepstakes for three years following the completion of a
sweepstakes.
(b) For purposes of this section:
(1) (A) "Authorized licensee" means a winegrower, beer and wine
importer general, beer manufacturer, out-of-state beer manufacturer
certificate holder, distilled spirits manufacturer, distilled spirits
manufacturer's agent, distilled spirits importer general, distilled
spirits general rectifier, rectifier, out-of-state distilled spirits
shipper's certificate holder, brandy manufacturer, and brandy
importer. An authorized licensee may conduct or participate in a
sweepstakes pursuant to this section if the licensee holds any
additional license not included in this paragraph.
(B) An "authorized licensee" shall not include a beer and wine
wholesaler, a beer and wine importer general, or distilled spirits
importer general that only holds a wholesaler's or retailer's license
as an additional license.
(2) "Sweepstakes" means a procedure, activity, or event for the
distribution of anything of value by lot, chance, or random selection
where the odds for winning a prize are equal for each entry.
(c) Nothing in this section authorizes conducting sweepstakes
where consumers are entitled to an allotment or accumulation of
points based on purchases made over a period of time that can be
redeemed for prizes, things of value, or additional sweepstakes
entries.
(d) An authorized licensee that violates this section, in addition
to any other penalty imposed by this division, may be prohibited by
the department from offering a sweepstakes to California residents
for a period of 12 months.
SEC. 3. No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.
SECTION 1. Section 25600.1 is added to the
Business and Professions Code, to read:
25600.1. (a) Notwithstanding any other provision of law, an
authorized licensee may conduct, sponsor, or participate in consumer
contests and sweepstakes, subject to the following conditions:
(1) (A) Except as provided in subparagraph (B), a purchase or
entry fee shall not be required to enter a contest or sweepstakes.
Entry or extra chances in a contest or sweepstakes shall not be made
available via the purchase of an alcoholic beverage. Entrance into a
sweepstakes shall be limited to persons 21 years of age or older.
(B) A purchase or entry fee may be required to enter a contest or
sweepstakes if the principal sponsor of the contest or sweepstakes is
a bona fide amateur or professional organization established for the
encouragement and promotion of an activity. Entrance into a contest
where the principal sponsor of the contest or sweepstakes is a bona
fide amateur or professional organization established for the
encouragement and promotion of an activity shall be limited to
persons 21 years of age or older.
(2) (A) Caps, cap liners, corks, labels, cartons, cases, or other
material attached to an alcoholic beverage shall not be used as an
entry to a contest or sweepstakes or as a means of determining the
amount or size of the prize or the winner in a contest or
sweepstakes.
(B) Entry forms may be provided via neck hangers or other printed
materials that are easily removable from alcoholic beverage
containers or packaging only if similar entry forms are available at
the point of sale or an alternative means of entry is available.
(C) Entry forms may be in the form of codes printed on alcoholic
beverage containers or packaging that may be scanned or
electronically entered by a consumer without requiring the purchase
of any product. All entry forms or codes attached to, printed on, or
in any way connected to or with an alcoholic beverage container or
package shall clearly indicate that the entry form may be removed or
the code scanned or electronically entered without the purchase of
any alcoholic beverage or other product.
(D) All sweepstakes entry forms shall provide an entrant with
equal odds of winning.
(3) A contest or sweepstakes shall not provide for the instant or
immediate awarding of a prize or prizes.
(4) (A) A visit to a retail premises shall not be required to
enter a contest or sweepstakes.
(B) Except as provided in subparagraph (C), a contest shall not be
held at the premises of a retail licensee or the premises of a
winegrower or beer manufacturer operating under a duplicate license
for a branch office.
(C) A contest in which the principal sponsor is a bona fide
amateur or professional organization established for the
encouragement and promotion of an activity may be held on the
premises of a retail licensee. Authorized licensees may sponsor or
participate in this type of contest only by making monetary payments
to the bona fide amateur or professional organization acting as the
principal sponsor.
(5) Alcoholic beverages or anything redeemable for alcoholic
beverages shall not be awarded as a contest or sweepstakes prize.
This paragraph shall not prohibit a contest or sweepstakes in which
the prize is cash or the awarding of cash in lieu of a prize that is
tangible personal property or real property.
(6) A retail licensee shall not serve as the agent of an
authorized licensee by collecting or forwarding entries or awarding
prizes to a contest or sweepstakes winner. The matching of entries
with numbers or pictures on the point-of-sale materials at retail
licensed premises is permitted only if entrants are also offered the
opportunity to use an alternative means to determine prize-winning
status.
(7) A licensee that is not an authorized licensee shall not share
in, or contribute to, the costs of a contest or sweepstakes
authorized by this section or serve as the agent of an authorized
licensee to collect or forward entries or to furnish any prize to a
contest or sweepstakes winner.
(8) (A) Advertising of a contest or sweepstakes shall comply with
the signage and advertising restrictions contained in this chapter,
Chapter 15 (commencing with Section 25500), and any regulations
issued by the department.
(B) Advertising or promotion of a contest or sweepstakes shall not
identify or refer to any retail licensee.
(C) A retail licensee shall only advertise or promote a contest or
sweepstakes authorized by this section in the manner specified in
subparagraph (A).
(D) Advertising or promotion of a contest or sweepstakes shall
only be conducted on the premises of a retail licensee when such
advertisement or promotion involves a minimum of three unaffiliated
retail licensees. For purposes of this subparagraph, "unaffiliated
retail licensees" shall not include any retail licensee owned in
whole or in part by an authorized licensee or any officer, director,
or agent of that licensee.
(E) Placement of signs or other advertising of a contest or
sweepstakes in a licensed retail premises shall not be conditioned
upon the following:
(i) The placement of any product within the licensed premises or
the exclusion of a product from the licensed premises.
(ii) The purchase or sale of any product produced, imported,
distributed, represented, or promoted by an authorized licensee.
(F) An agreement, whether written or oral, entered into, by, and
between a retail licensee and an authorized licensee that precludes
the advertisement or promotion of a contest or sweepstakes on the
premises of the retail licensee by another authorized licensee is
prohibited.
(9) Contest or sweepstakes prizes shall not be awarded to an
authorized licensee, retail licensee, or wholesale licensee or agent,
officer, employee, or family member of an authorized licensee,
retail licensee, or wholesale licensee. An authorized licensee shall
maintain all records pertaining to a contest or sweepstakes for three
years following the completion of a contest or sweepstakes.
(b) For purposes of this section:
(1) (A) "Authorized licensee" means a winegrower, beer and wine
importer general, beer manufacturer, out-of-state beer manufacturer
certificate holder, distilled spirits manufacturer, distilled spirits
manufacturer's agent, distilled spirits importer general, distilled
spirits general rectifier, rectifier, out-of-state distilled spirits
shipper's certificate holder, brandy manufacturer, and brandy
importer. An authorized licensee may conduct, sponsor, or participate
in consumer contest and sweepstakes pursuant to this section if the
licensee holds an additional license not included in this paragraph.
(B) An "authorized licensee" shall not include a beer and wine
importer general or distilled spirits importer general that only
holds a wholesaler's or retailer's license as an additional license.
(2) "Contest" means a game, contest, puzzle, scheme, plan, or
similar activity that holds out or offers to participants the
opportunity to receive or compete for gifts, prizes, gratuities, or
other things of value as determined by skill, knowledge, or ability
rather than upon random selection. Skill, knowledge, or ability does
not include the consumption or use of alcoholic beverages.
(3) "Principal sponsor" means the person or organization that is
identified as a primary or major sponsor of the
event or activity or for which the event or
activity is named.
(4) "Sweepstakes" means a procedure, activity, or event for the
distribution of anything of value by lot, chance, or random selection
where the odds for winning a prize are equal for each entry.
(c) A contest or sweepstakes conducted pursuant to this section
shall not offer or award more than five prizes that exceed the
monetary limits for premiums, gifts, or free goods specified in this
division or a regulation of the department.
(d) Nothing in this section authorizes marketing schemes where
consumers are entitled to an allotment of points based on purchases
made over a period of time that can be redeemed for prizes, things of
value, or additional contest or sweepstakes entries.
(e) An authorized licensee that violates this section, in addition
to any other penalty imposed by this division, may be prohibited by
the department from offering a contest or sweepstakes to California
residents for a period of 12 months.
SEC. 2. No reimbursement is required by this
act pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.